When it comes to hybrid vehicles, it
appears that Honda just can't catch a break. Its first generation
Insight hybrid was the first such vehicle to hit American soil a
decade ago, however, the vehicle was a sales failure. Honda went on
to develop
a Civic Hybrid which hasn't exactly been a Prius competitor in
terms of sales and the company's Accord
Hybrid, like the Insight before it, failed in the marketplace.

Honda looked to go after Toyota's Prius
again with a larger, second
generation Insight. However, Honda again ran into a brick wall.
Honda managed to undercut the Prius by a few thousand dollars, but
also did so with a much smaller vehicle that was not as fast, not as
tech-laden, and not nearly as fuel efficient as the third-generation
Prius. When it comes to actual
vehicle sales, the numbers don't lie. Honda sold
roughly 20,500 Insights during 2009 in the U.S. -- Toyota, on the
other hand, sold
nearly 140,000 Prius hybrids.

"Are we happy with how sales are
going? No, we're not happy," said American Honda executive VP
John Mendel.

Faced with the prospect of another dud
in the hybrid marketplace, Honda chief Takanobu Ito is calling on his
engineers to develop a vehicle that will "Out Prius" the
Prius according
to Automotive News. Ito wants a hybrid that will be able
to exceed the stellar fuel economy ratings of Toyota's crown jewel.
Toyota's Prius is rated at 50 mpg (city/highway combined) while the
smaller Insight is rated at just 41 mpg (city/highway combined).

"We want to develop and expand our
hybrids," said Ito earlier this month in Detroit. "We made
some major sacrifices to shift people and resources to do that."

While Honda looks like it will have its
hands full developing a vehicle to topple the Prius, it has also just
launched a new "sporty"
hybrid aimed at enthusiasts. The CR-Z can be had with a manual
transmission, but fuel economy junkies should be warned -- choosing
to the manual will result in a serious hit to city fuel economy. A
CR-Z equipped with a continuously variable transmission (CVT) will be
rated at 36/38 mpg (city/highway). Opting for the six-speed manual
transmission, however, will cut those numbers to 31/37 mpg.

For comparison, a Mini Cooper
(six-speed manual) gets 28/37 mpg without the need for hybrid
components.